Independent senator Nick Xenophon has explained why he supported the government’s tax cuts for businesses with $50m turnover or less, saying he did the best he could in the circumstances.
Speaking on the ABC’s Radio National on Monday, Xenophon hit back against heavy weekend criticism of his decision and stressed he secured far more from the deal last week than just one-off payments for pensioners.
The government secured a portion of its $48bn tax package last week with the support of Pauline Hanson’s One Nation, senator Derryn Hinch, and the Nick Xenophon Team.
The government will now be cutting taxes for businesses with an annual turnover of $50m and less, with the cuts to be staggered in over the next two years.
The tax cuts will cost the Commonwealth budget $5.2bn over four years and $24bn over the medium term.
Xenophon said that in return for his backing, the government gave a firm commitment to fast-track a solar-thermal plant, already promised, in Port Augusta.
“That’s hardly a dud deal,” he said.
He said the government would establish a review of Australia’s gas retention policies, and investigate the prospect of a gas pipeline from the Northern Territory.
He also stressed the importance of getting the government to agree to lock-in changes to the rules of the national electricity market, with a defined date of 1 July next year.
“The Australian Energy Market Commission and the Climate Change Authority will be making recommendations. If the government ignores those recommendations then it puts everyone in a very difficult position,” Xenophon said.
“The fact that the government has agreed to a firm date for sweeping changes of the national electricity market rules is very significant.”
He said a forthcoming report from the AEMC and CCA will be presented by the government to the public on 15 June, when it is tabled in Parliament. That work will then inform any changes to the market rules by 1 July 2018.
“There will [now] be transparency around the proposed changes to the rules in terms of what’s being recommended by these two peak bodies by 1 June, and by 15 June we’ll see what’s been recommended,” he said.
“I did the best I could within the constraints and the circumstances [I faced].”
He said a one-off payment for pensioners – $75 for a single person, and $125 for a couple for those on the aged pension, the disability support pension and the parenting payment – was also important.
The treasurer, Scott Morrison, told 2GB radio on Monday that the deal with the Xenophon Team had a range of measures.
“A lot of them had to do with initiatives we were already looking at on energy, and some of work we were doing there around gas [and] solar” he said.
“But on top of that, they requested that there be a one-off payment to pensioners and disability support pension recipients, and we agreed to that.
“We wanted to see the tax cuts get through,” he said.
He did not say how the one-off payments, worth $260m, would be funded.
On Sunday, Labor refused to rule out clawing back small and medium business tax cuts after the next election.
The shadow assistant treasurer, Andrew Leigh, said Labor would decide whether to roll back the tax cuts before the next election, saying it would consider the impact on Australia’s Triple A credit rating which was a “bigger concern to a lot of businesses than a company tax cut”.
